Implementation of climate resilience

The energy sector is at risk from climate change and it is also at risk from current climate variability. Risks handled today, while perhaps are not enough to fully address climate change, will help to address risks into the future. Adaptation measures to climate change and climate variability will surely increase the resilience of energy systems. Thus, to increase the resilience, climate change’s adaptation needs to be integrated into energy planning and decision-making processes at all relevant levels.

Remembering the definition of adaptation (The process of adjustment to actual or expected climate and its effects. Adaptation seeks to moderate or avoid harm or exploit beneficial opportunities. (IPCC, 2014, p.40)), the targets of the analysis are to reduce the damage from climate change and make resilient the energy system. To reach these objectives it is necessary put into practice some deeds and strategies, which will be delineated in the following sections. Adaptation to climate change is transitioning from a phase of awareness to the construction of actual strategies and plans in societies (IPCC, 2014, p.871). The combined efforts of a broad range of international organizations, scientific reports and media coverage, have raised awareness of the importance of adaptation to climate change, fostering a growing number of adaptation responses in developed and developing countries. The awareness of the need of adaptation has reached a considerable level: on the other hand, the knowledge about adaptation is still generally scarce, especially in the management of climate risk. Energy risk needs to be assessed and managed from a base of information that is far from perfect. The uncertainties in hydro-meteorology, climate perspective, in short-term and long term predictions will affect the development. Therefore, it is necessary a methodology to improve adaptation in all its dimensions.

In regards, there are probably two basic approaches to guide decisions and actions in risk management and adaptation development (even if we would say that one is not an adaptation approach). Either methods should not use single-scenario assessment of risk. There is nothing incorrect in strict scientific terms in the results produced using single-scenario assessment of risk, but it should always keep in mind that single-realization approaches do not reveal the true extent of the uncertainties involved. Considering that, the two approaches are the do nothing and the proactive. The do nothing approach – which is not an adaptation approach – permits complacency, or more appropriately, lack of awareness. The planning goes along traditional lines, taking climate risks into account as they become clear and managing any issues retroactively. The proactive approach on the other hand makes mainstream the risk management. This approach essentially takes into account in advance the risk correlated with climate change in climate strategies, embracing the idea of adaptation.

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The following sections explore the desirable outcomes of adaptation decisions and strategies, the main gaps and options to integrate climate risk considerations into energy systems. They recognize the various levels at which integration needs to take place and the multitude of stakeholders involved.

This description will be divided into three parts, underlining the most important characteristics we should take in consideration.

5.1.1 Awareness versus knowledge

Climate change is expected to have a wide range of direct and indirect effects on energy production and consumption patterns. Though, the research and policy-oriented literature are still generally scarce on energy-related climate risk and impacts, not less for management which is emerging. Detailed data on possible climate effects are needed to take decisions about short-term adaptive management and longer-term planning, related, for example, to technological change. It is also important to raise awareness and concern at project, policy and planning level about climate impacts on energy services, as at the wider implications for development. The literature supports identification of key issues and potential options, but the knowledge base is relatively limited for making generalized conclusions on the integration of adaptation options in planning and decision-making. There is a minority of academic literature that provides information on the implementation of adaptation plans, in contrast with the large amount of literature that discusses concepts, strategies and plans of adaptation (IPCC, 2014, p.877).

However, the growing literature on the subject illustrates increasing scientific awareness. An example of this is the study Raising awareness of climate change. A handbook for government focal points (United Nations Environment Programme, 2006). In this handbook the authors implemented a checklist for raising awareness. They set a list of steps for planning and organizing a climate change communications strategy, drawn on the wide range of experiences that organizations and government have had in conducting outreach.

5.1.2 Uncertainty in the decision-making

Responding to climate change involves an iterative risk management process that includes both mitigation and adaptation, taking into account actual and avoided climate change damages, co-benefits, sustainability, equity and attitudes to risk. (Pachauri and Intergovernmental Panel on Climate Change, 2008).

Risk is often represented as the probability of occurrence of hazardous events or trends multiplied by the magnitude of the consequences if these events occur. Therefore, high risk can result not only from high probability outcomes but also from low probability

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outcomes with very severe consequences. This makes it important to assess the full range of possible outcomes, from low probability tail outcomes to very likely outcomes (Pachauri and Meyer, 2015).

A risk-based approach to climate change adaptation can support informed decisions to avoid maladaptation and minimize the risks of over- and under-adaptation. This section describes risk management approaches that are being used to identify adaptive responses and increase the climate resilience of energy systems. It highlights areas where efforts should be strengthened or knowledge gaps exist.

Climate risk management

Risk assessment and management are already important aspects of energy decision making. Energy providers are get used to policy changes, shifting global market conditions, changes in financial variables and climate variability. Energy users cope with price fluctuations as well as near term shortages in energy availability, caused by extreme weather events and damages to energy distribution infrastructure.

Climate considerations are evident especially in planning and investment strategies for renewable resources that depend directly upon climate parameters. Currently, the use of present-day or historical weather and seasonal climate data and information is part of everyday risk management for many utilities and regulators across the world (Audinet et al., 2014). However, the integration of forward-looking information on climate change in decision-making (“climate change adaptation”) remains limited. Long term changes in climate and short-term increases in climate variability (as we have seen) are increasingly impacting generation, transmission and distribution of electricity, forcing industry to consider new ways to manage the associated risk.

The UK Climate Impact Programme (UKCIP) developed a risk-based framework (see Figure 5.1) for adaptation decision making in the technical report Climate adaptation: risk, uncertainty and decision-making (Willows et al., 2003).

The decision-making framework is composed by eight stages: 1. Identify problems and objectives;

2. Establish decision-making criteria; 3. Assess risk;

4. Identify options; 5. Appraise options; 6. Make decision; 7. Implement decision;

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Figure 5.1 A generic framework to support good decision-making in the face of climate change risk (IPCC, 2014, p.851, based on (Willows et al., 2003, p.7))

The iterative risk management process shows a cyclical nature and uses uncertain long-term impacts to develop short-term adaptation priorities and options. This is useful for two main reasons:

1. It provides the short-term policy or project analysis and advice that decision makers need;

2. New information and data can be incorporated continuously as they become available to alleviate constraints on decision-making posed by uncertainty. Decision-making criteria can be revised when new information on costs and feasibility becomes available.

For each stage of the framework there are key issue that decision-maker should consider and questions that should be answered. Stages 1 and 2, for example, define the nature of the decision problem, the decision-maker’s objectives and criteria that help differentiate between options. At stage 3 climate change risks associated with the decision are formally identified and assessed, alongside other non-climate risks. Climate change scenarios are an important tool to give information in this stage. At stage 4 the decision-maker should aim to identify options that are robust to climate change and provide the greatest likelihood of meeting the objectives and criteria defined in stage 2. In particular, the decision-maker should try to find “no regret” and “low regret” options. These options are appraised against the criteria in stage 5, to determine the preferred or best option. Stage 6 then demands that the decision-maker

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forms a judgement, that all issues revealed during the decision-making process have been addressed.

The Energy Sector Management Assistance Program (ESMAP) in its document Climate vulnerability assessments (ESMAP, 2009) presented a similar framework for decision- making, to support adaptation of energy infrastructure vulnerable to climate change (Figure 5.2). It created the framework basing it on experience and published guidance from United Kingdom (UKCIP) and Australia.

Figure 5.2 Decision-making framework for adapting vulnerable energy infrastructure to climate change (ESMAP, 2009, p.2)

A deeper analysis of the various frameworks for adaptation decision-making reveals that climate risk management requires an interdisciplinary effort, where the tools and knowledge of scientists, energy analysts, economists, policy makers, planners and citizens are combined. Collectively the frameworks highlight at least four features that are relevant for the energy sector: practically, flexibility, compatibility and stakeholder engagement.

In this sense, the United Nations Office for Disaster Risk Reduction (UNISDR) produced the Hyogo Framework for Action 2005-2015: building the resilience of nations and communities to disaster (HFA), a plan to explain, describe and detail the work that is required from all different sectors and actors to reduce disaster losses. It was developed and agreed with the

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help of many partners, which were needed to reduce risk disaster – governments, international agencies, disaster experts and many others – bringing them into a common system of coordination. In the Hyogo Framework for Action 2005-2015: building the resilience of nations and communities to disaster. Mid-term review 2010-2011 (United Nations Office for Disaster Risk Reduction, 2011) the authors highlighted the significant progress that has been made over the past years in disaster risk reduction: they also accentuated the fact that the adoption of the Hyogo Framework for Action in 2005 has played a decisive role in promoting this progress across international, regional and national agendas.

Dealing with uncertainty

The energy-system impact relationship is highly complex and uncertain. Uncertainty about the exact nature of climate change impacts at the local and regional level (for example in terms of precipitation and storminess) makes difficult to improve and fine-tune adaptation measures.

Uncertainty exists where there is a lack of knowledge concerning outcomes. It may result from an imprecise knowledge of the risk. However, even when there is a precise knowledge of frequency and magnitude of events there is uncertainty, because outcomes are essentially unknown (Willows et al., 2003, p. 43).

Uncertainty could arise for a lot of reasons: for the estimation of the future growth in greenhouse gas emissions and their concentration in atmosphere, for the estimation of the extent of warming, when regional climatic responses are taken into account, when we consider impacts on various humans and natural systems; etc. Planners and decision makers need local, specific and detailed information about aforementioned cases: however, all those points raise uncertainty.

We could sum up the various types of uncertainty in six categories: “real-world” uncertainty, data uncertainty, knowledge uncertainty, model uncertainty, outcome uncertainty and decision uncertainty. The various uncertainties and their typology could be identified using a risk-based framework, as the UKCIP one showed in the previous section, or using some specific multidisciplinary tools for planning, as suggested by the IPCC in the AR5 (IPCC, 2014, p.883). Some of these tools could be monitoring, modeling or spatially integrated systems with the techniques of GIS. Other ones could be communication tools, like brochures, bulletins, posters, magazines, policy briefs, videos TV, radio broadcasts, Internet and many more. Finally, some more tools could be early warning systems.

Furthermore, climate-sensitive decisions deal with uncertainty: it is useful to know in what way these decisions could be influenced by uncertainty. Some decisions are based on a recognized need to manage current climate variability and extremes and/or to address adaptation in anticipation of longer-term climate change. In this case, awareness and

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knowledge on climate variability are high. For some other decisions, climate variability and change may be one of many uncertainties that influence the outcome of a decision. In this case, raising awareness among planners and decision makers may be an important first step, to ensure that attention is paid to the potential impacts of climate change.

We could observe then that an inherent risk hits the adaptation decisions and measures: the risk of committing an error in the adaptation. We could distinguish three types of adaptation errors:

 Under-adaptation. Too little emphasis is placed on climate risks. It may result from a failure by decision makers to consider or identify climate change or specific climate variables.

 Over-adaptation. Climate change or related variables are overemphasized: in practice, practices turn out that are not to be significant or too little weight has been given to non-climate factors compared to climate factors.

 Maladaptation. Actions taken (unintentionally) that constrain the options or ability of other decision makers now or in the future to manage the impacts of climate change. Proper integration of climate risks in decision-making processes will minimize the risk of over-, under- and maladaptation.

Timing and uncertainty

The long-term nature of climate change makes timing an important part of adaptation decisions. The lifetime of a decision is an important consideration when determining whether climate adaptation is needed.

Timing decisions depend on the relative costs and benefits of taking action at different points in time. In particular, decision makers will compare the present value of adaptation now with the present value of adaptation at a later stage. Thus, as described in the document Economic aspects of adaptation to climate change: costs, benefits and policy instruments (Agrawala et al., 2008), the timing decision depends on three factors. The first is the difference in adaptation costs over time. The effect of discounting would normally favor a delay in adaptation measures, so would the prospect of potentially cheaper and more effective adaptation techniques that might be available in the future. The second factor is the short- term benefits of adaptation. Early adaptation will be justified if it has immediate benefits, for example by mitigating the effects of climate variability. The measures that provide short-term adaptation benefits can be characterized as no- or low-regret options. The third component has to do with the long-term effects of early adaptation. Early adaptation is justified if it can guarantee lasting benefits.

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Furthermore, it is useful make a comment on the relation between time, uncertainty and the long-lived infrastructure. Many supply, transmission and distribution investments are large and long-lived. Early adaptation action for long-lived infrastructure investments will generally be less costly and more effective than retroactive maintenance and repairs or expensive retrofitting. Furthermore, substantial investments in energy infrastructure are ongoing or under way in most regions around the world and are expected to continue. 5.1.3 Mainstreaming climate risk management into energy planning

There is a tall wall between our scientists and our decision makers. Scientists do their research and lob their information over the wall, hoping that somebody on the other side will catch it in receptive hands and act on it. However, what is on the other side of the wall is a big pile of papers and information that the decision makers pay no attention to (Jonathan Foley, 2010, cited in Ebinger and World Bank, 2011, p.93). This section discusses options to fill knowledge, information, awareness and capacity gaps for climate risk management in the energy sector. It highlights the role of governments and institutions at the local, national and international levels.

Scientific knowledge

Climate risk management presents a knowledge gap: the lack of capacity to model and project climate impacts at local and regional scales is perhaps the most prominent. Government institutions and international research communities have the important task of filling this gap.

Some considerations should be taken into account when prioritizing risk research.

 How far can the risk be reduced through further research and in what time frame?  How deep are the uncertainties? Do they arise from data needs, a modeling problem,

or do we basically not have a scientific understanding of the risk phenomena?  How do the uncertainties interact with the profile of the risk?

To balance these aspects, we may consider some principles:

 Knowledge needs of various decision makers and stakeholders;

 The cost-effectiveness and likelihood of risk reduction give large uncertainties;  Investments in decisions with short-term payoffs versus high-risk/high-gain longer-

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Guidance for decision makers

Governments, local, regional and national institutions and stakeholders are decisions-makers: they are not the scientists who investigate on climate change, adaptation and risk management. Most of the times, the information obtained by scientists are not comprehensible by decision-makers, which consequently pay no attention to. We need a lot of effort to translate scientific data and knowledge into information relevant to decision making on adaptation.

The correlation between decision-makers and researchers could be summed up by the following outline (see Figure 5.3). As written in the previous paragraph, decision-makers and the research communities have the important task to fill the knowledge task with their skills. Decision-makers should support the scientific community whereas scientists should provide understandable data to decision makers to implement correct adaptation strategies.

Figure 5.3 The decision-makers/scientists connection. Created by author

Scientists should provide particular comprehensible information to support the capacity of decision makers at various levels. This knowledge should be shown using maps, guidelines and plans to facilitate the decision-makers.

The WGII in Climate change 2014: impacts, adaptation, and vulnerability. Part A: global and sectoral aspects (IPCC, 2014) highlighted how limitations of current institutional

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arrangements within decision-makers restrict the mainstream of climate adaptation. They continued declaring that expanding research on institutional arrangements in at least three key areas can help improve the implementation of adaptation plans in both developed and developing countries. These areas are the multilevel institutional coordination between different political and administrative levels, the institutional rigidity and the coordination between formal governmental and administrative agencies and social and private stakeholders.

The UNEP then in Raising awareness of climate change. A handbook for government focal points (United Nations Environment Programme, 2006) asserted that a communication program for decision-makers for addressing climate change could be successful as first step